ALL BUSINESS: More Transparency Needed From Fed

Over the last two years, the central bank has used its emergency powers to establish various programs to lend or buy debt to help mend the financial system and lift the country out of recession. In the process, its balance sheet holdings have more than doubled since September and now total more than $2 trillion.

Those programs have saddled the Fed with massive credit risk, but the public has largely been unaware of what's behind the numbers.

The Fed just last week started releasing monthly figures for its credit and liquidity programs that began in the summer of 2007. While that's a step in the right direction toward boosting transparency, it doesn't go far enough.

"A lot of what is presented have valuations that are already outdated," said Robert Eisenbeis, chief monetary economist at the portfolio management firm Cumberland Advisors and a former director of research at the Federal Reserve Bank of Atlanta.

Details in the monthly reports are also skimpy. Eisenbeis points to disclosures about the holdings of Maiden Lane LLC, which was formed by the Fed in the spring of 2008 to facilitate Bear Stearns' fire sale to JP Morgan Chase & Co. As part of that arrangement, the Fed supplied a line of credit to Maiden Lane to fund the purchase of Bear Stearns assets.